Economic success factors of the reindeer husbandry

Reindeer herding is a significant rural business in Northern Finland, also in terms of tourism and food processing. However reindeer husbandry has faced difficulties during past few years. The markets for reindeer meat markets have been unstable, and the profitability of reindeer herding has been poor.

The goal of the project

The aim of this study is to deepen the understanding of how economic environment of the reindeer herding has developed recently.

The main results

The biggest challenges for Finnish reindeer husbandry are the low profitability of reindeer farms, the erosion of winter grazing grounds of reindeer cattle and partially inefficient supply chain of reindeer meat.

The Finnish reindeer husbandry is practiced through a system of reindeer herding cooperatives. Coordination of these cooperative is the most important factor influencing the reindeer cattle. Inadequate pastures or economical reasons have compelled to slaughter in order to decrease number of reindeers. In Southern part of the reindeer herding area the predators have been one remarkable reason for reindeer cattle decrease.

Reindeer meat is reasonably well differentiated product in the Finnish grocery sector. For the food processing industry the reindeer meat is a complicated raw material. The meat has good image and is therefore highly valued and has great demand. However the increasing price together with decreasing supply of reindeer meat may limit the product and marketing development in processing.

Co-operation between reindeer farms is strong but co-operation between reindeer herders and slaughterhouses or retail trade is uncommon and fragmented. Particularly, in the Finnish reindeer meat market the problem seems to be oligopoly pricing combined with asymmetric information. Few reindeer meat-processing companies have an information advantage. They give the price signal to the market and others are following them.

The cultural continuation is important in Finnish intergenerational transfers. The low level of closure pension and the lack of subsidies for the continuator are considered the biggest problems in the process intergenerational transfer.

More detailed results

Reindeer meat products in Finnish grocery stores
Catering Sector’s Use of Reindeer and Game in 2005
Value Chain of Reindeer Meat
Economic success factors of the reindeer husbandry
Profitability bookkeeping of reindeer husbandry

Material and methodology

Quantitative and qualitative methods were used in the analysis. Two large separate postal surveys were carried out. In addition financial results of book keeping reindeer husbandry farms were utilised and several expert interviews were conducted in order to get deeper insights to the phenomenon

Funding

The research project was partly funded by the Finnish Ministry of Agriculture and Forestry.

Scientist in charge of project

Kaija Saarni
Turku Game and Fisheries Research
Itäinen Pitkäkatu 3, FIN- 20520-Turku, Finland
Phone: +358 295 327 687
e-mail: firstname.lastname@rktl.fi

Other research staff:

MTT Agrifood Research Finland: Leena Rantamäki-Lahtinen ( co-ordination), Jukka Tauriainen and Jussi Tuomisto e-mail: firstname.lastname@mtt.fi

Finnish Game and Fisheries: Asmo Honkanen and Jari Setälä e-mail: firstname.lastname@rktl.fi

University of Lapland: Klemetti Näkkäläjärvi

Cooperation The research is conducted with the co-operation of MTT Agrifood Research Finland and University of Lapland

Duration: 2006–2008

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